Transaction processing systems have been developed which enable consumers to obtain goods or services by using credit or debit cards. Credit cards are used by a consumer to charge against an account for the goods or services being provided. When using a credit card, the consumer later pays the credit card issuer for the amount charged. A common example of a credit card is the VISA.RTM. card provided by VISA International.
Debit cards may also be used by consumers to pay for goods or services. A debit card is associated with a bank account maintained by the consumer. When a consumer uses a debit card to pay for goods or services, the amount of the transaction is deducted from the consumer's account.
Electronic credit and debit card terminals have been developed which facilitate the processing of debit and credit card transactions. Merchants generally have these terminals at a point of sale of goods or services. Such terminals are connected through telephone or other data lines to computer networks which process and keep accounts of transactions. When a consumer purchases goods or services at a point of sale the consumer's account may be charged if a credit card is used and the merchant's account may be credited. Similarly, if a debit card is used to pay for the purchase, the consumer's account is debited for the amount of the purchase and the merchant's account is credited.
Such point of sale (POS) terminals often keep a record of the transactions in memory. Periodically the terminal is connected via data line to a computer called a settlement host which receives a record of all the transactions that have been conducted. The settlement host operates to make sure that the merchant's account is properly credited for all of the transactions that have been carried out at the terminal.
The vast majority of credit and debit cards in use in the United States today contain information on the customer account associated with the card. This information is presented in two forms. The account number associated with the customer's account is presented in raised numerals on the card along with the customer's name and certain other information. This enables a merchant to mechanically make an impression of the account data on a multi-part form. The other way in which account information is generally provided is by encoding the account information on a magnetic stripe on the back of the card. The magnetic stripe may have up to three data bearing tracks which includes data representative of the customer's account number, name and other data.
Conventionally, the account number data on a customer's card includes a numeric identifier which identifies the card issuer and/or the bank which issued the card. This account number data, which is generally referred to as a primary account number or "PAN" contains sufficient information to identify the card issuer and the account. Often, particularly in the case of debit cards, the account number includes a bank institution number or "BIN" which identifies a particular bank. Electronic financial processing networks have been developed which enable the routing of the transaction messages based on the card information so that the appropriate accounts are charged and credited.
In recent years, integrated circuit cards have been developed. These cards are often referred to as "smart cards". Integrated circuit cards are similar to conventional debit and credit cards, except that they additionally include an integrated circuit chip. The integrated circuit chip is used to store data related to the customer and his or her account. The integrated circuit chip often includes encryption programs and stored data which are used to correlate card information with a personal identification number or PIN which a customer may input in a transaction terminal. This correlation is used to provide authentication that the bearer is the proper user of the card.
Integrated circuit type chip cards also generally include data in memory representative of cash value. This cash value data is stored on the card. This value may be used in the same manner as cash by the card bearer to purchase goods or services.
Terminals have been developed which read the data included on the integrated circuit and which change the stored data to represent an addition or subtraction of cash value. Merchants who have such terminals may accept a customer's integrated circuit card as payment by reducing the value data stored on the card.
Systems involving the use of integrated circuit cards have not been used extensively in the United States due to a lack of available systems for processing such transactions. Before integrated circuit cards may gain wide acceptance there must be a means of loading the data representative of value on to the integrated circuit card. Ideally such loading must be done conveniently from a consumer's other accounts. In addition, wide acceptance of such cards requires the development of systems for settlement between entities which charge a consumer for the value loaded on the card and the merchants who reduce the value data on the integrated circuit card in payment for goods or services.
Thus, there exists a need for a system which is capable of loading and unloading data representative of value on to an integrated circuit card in which the value is taken from and returned to sources of funds associated with credit or debit cards. There further exists a need for a system which provides settlement between entities involved in transfers of cash value to and from the card users, which value is represented by data stored on the integrated circuit cards.